Get A 31% Increase In Email Revenue With A Dedicated Infrastructure

Mobile marketing, like text and push notifications, is growing fast — but email is still the primary channel for marketing communication and customer engagement. Everyone has email and uses it daily, checking everything from work accounts to personal accounts, on a variety of devices such as PCs, tablets and mobile phones.

The growth of new channels just serves to strengthen the primacy of email as a marketing tool. In fact, according to a recent report by Movable Ink, 66% of emails in Q1 2014 were opened on a mobile device such as a smartphone or tablet.

Mobile Email Open Rates, Q1 2014

This means that email is still an indispensable element of your marketing arsenal because it is now consumed in entirely new ways. But for reasons I’ll detail below, many marketers aren’t getting as much as they could from their email programs.

Maximize Your Email Investment

Because they don’t feel they have the in-house expertise, many companies have outsourced their email marketing to one of a host of email service providers (ESPs), frequently changing providers in an effort to negotiate costs down. This solution can create problems, especially for those companies that use their ESP simply as a “pipe” for message delivery, as is increasingly the case.

Because of the growing desire to personalize email with related data, more and more companies are handling email tasks such as list segmentation and targeting in-house, and contracting with ESPs simply for the delivery component – or using very low cost SMTP relay type providers. This may seem like a more cost-effective way to go, but as we’ll see, it’s not necessarily so.

Three Numbers To Keep In Mind: 99%, 82%, 31%

With the pressure today to increase engagement while lowering costs at the same time, you need to maximize the return on your email investment by ensuring your emails reach their intended targets. After all, you can’t engage a customer unless you can start a conversation with him or her.

Ask a sales rep from an email delivery service provider what kind of deliverability rate you can expect using that firm’s services and you’re very likely to hear 99 percent.

Yet Return Path, the most authoritative voice in the industry on deliverability, tells us the global inbox placement rate for opt-in emails – messages that people have actively subscribed to and should therefore have a higher inbox rate than the average – stands at 82 percent. Clearly, we have an engagement gap here, but where exactly is the disconnect?

Let’s look at what’s typically happening today. Your ESP sends your emails to one or many ISPs and reports a 99 percent delivery rate back to you. Meanwhile, because the ESP has other customers, your email campaign is actually part of a mix that includes messages from hundreds or thousands of other senders — some of them may even be your competitors.

With that kind of mix, it’s impossible for you to effectively protect your sending reputation — you’re lumped in with the rest of the senders — so there are bound to be blocks or other delivery issues when your messages are passed through the ISPs.

It makes sense that this is a growing challenge. Because email is so pervasive and customer expectations are evolving, we must cope with enhanced authentication methods, anti-spam regulations and laws. And it’s in the ISPs’ interests to protect their users from unwanted email. No wonder only about 82 percent of your emails are actually reaching your targets’ inboxes.

Inadequate Data

Additionally, because of the shared infrastructure used by most ESPs, data collection — on deliverability and everything else — is slow and usually comes packaged in summary form. The ESP’s systems may not even generate the data you need in the formats required by your own systems and applications.

Finally, delivery providers typically charge on a per-message-sent CPM model, which means you constantly face high continuing costs that can only rise as your programs become more successful and your mailing volumes grow. This despite that fact that your budget is flat – or even diminishing.

The pain businesses feel from the status quo is real, yet within many industries there hasn’t been much impetus to change. Maintaining a relationship with a delivery service can in many cases provide perfectly adequate messaging capabilities at a reasonable price. Yet the days of “good enough to get by” are not likely to last much longer, and smart email marketers are looking to make a change from the status quo.

Consider A Dedicated Email Infrastructure

Most marketers tend to view email and deliverability as tactical issues that are best handled by outside experts. However, taking control over your sending operations and implementing dedicated infrastructure – whether on your own premises or using a dedicated solution in the cloud – is an effective way to drive higher levels of customer engagement and improve campaign results. One benefit is the immediate data access that can power real-time analytics.

Better insight into sending data doesn’t just make it easier to spot ISP issues that keep average deliverability in the 82 percent range, it makes it possible to respond faster to customers, to create conversations and engagement in place of the old one-way marketing model.

The insights you gain from the data will help you shorten issue resolution, improve service levels, drive down program costs and boost revenues. In fact, a Relevancy Group study found that with a dedicated platform, marketers can expect to achieve a 17 percent increase in deliverability, which directly translates into a 31 percent rise in revenue.

It’s how you can get more revenue for the same amount of work. Imagine if each of your campaigns performed 17 percent better, and what that would mean for your business.

Some opinions expressed in this article may be those of a guest author and not necessarily Marketing Land. Staff authors are listed here.

About The Author

Steve Dille is the senior vice president of marketing at SparkPost, a provider of digital messaging technology. He leads the company's global product marketing, demand-generation, branding and communications operations.